Imagine yourself in Costa Rica, floating in a pristine, blue-green pool of water and looking up at a lush rain forest canopy. You watch in amazement as, little by little, a three-toed sloth makes his way through the thick forest with the precision and grace of a Tai Chi master.
You’ve been working hard on your financial fitness. It’s time to make finance fun and treat yourself. What do you gravitate toward? Is it something you do, or is it something you own? If you’re out shopping for a reward of some kind for yourself, you can maximize your happiness dollars with an experience. Whether high-priced or economy-sized, it’s a better buy on happiness to purchase an experience than to purchase an object.
Experiences vs. Objects
How do you buy an experience? Think of taking a class on a topic that interests you, sharing a beverage or a movie with a friend or taking a trip someplace new just for fun. Material buys, on the other hand, are objects we keep in our possession, such as a gadget, a new outfit or dining room furniture. An Italian sports car would be a material purchase that can also double as an experience, but it’s still defined as something we keep in our possession.
When it comes to money and happiness, you happiness-shoppers out there might remember my blog about what small pleasures can buy. As I mentioned in the blog, research by Elizabeth W. Dunn, Daniel T. Gilbert and Timothy D. Wilson revealed eight principles for getting the most happiness from our spending. These are outlined in the Journal of Consumer Psychology article “If Money Doesn’t Make You Happy Then You Probably Aren’t Spending It Right”. Making experiential rather than material purchases is one of the happiness-maximizing principles.
Where the Happiness Comes From
Why do we derive more happiness from what we experience than from objects we possess? First, our minds adapt very rapidly to our environment. The new furniture eventually looks the same and the shoes are the ones we bought a few months ago, so we stop noticing. In contrast, experiences are different each time. Novelty gets our attention, and our “happy meter” is reset by whatever is new. Every trip to the park with my three-year- old daughter is certainly unique, even if we went every day.
A second reason experiences are more happiness-producing is that they’re ephemeral, passing quickly out of our possession. Memories remain, so we can revisit them as often as we want. We’re not very likely to reminisce about tangible purchases, but we often mentally re-experience events over and over.
Finally, experiences bring more happiness than objects because we define ourselves more by our experiences than our possessions. This is perhaps the most important reason. Places we go and things we do are more inherent parts of our identity than what we stockpile. I think of this as our life wealth. It’s the abundance of experiences we accumulate that is truly wealth gathering.
Memory Bank or Storage Room
There’s nothing wrong with buying material objects. We all need them. If they’re in the form of a reward, we can certainly derive happiness from them. However, next time you’re ready to treat yourself by using your money for something special, think about acquiring an experience instead of an object. Likely you'll enjoy it longer and have something to revisit in your memory bank rather than your storage room!